As the subway system has rebounded from the dark days of the Bernhard Goetz era, the MTA has sometimes struggled to fill its empty retail spots. Newsstands with their arrays of candy bars fill some spaces while discount clothing stores line some corridors. The Record Mart remains the best place to build up your back catalog of Fania releases. But otherwise, retail has yet to embrace the subway.
Lately, though, as part of an aggressive push to maximize empty space and draw in more dollars, the agency has pushed for new commercials opportunities, and this week, they announced a pop-up shop initiative that will bring retailers underground. These stores will receive month-to-month leases to operate in what the MTA is calling temporarily vacant spaces as the agency works to find takers for long-term leases. The Newsstand at Lorimer/Metropolitan in Williamsburg piloted the concept, and now Uniqlo has opened a store within fare control at the Union Square station.
In a press release, MTA officials spoke about orienting these spaces toward the ever-popular Millennials. “The younger generations are gravitating to the subway system as never before,” MTA Real Estate Director Jeffrey Rosen said. “They are savvy about shopping online. Retailers want to reach them where they are, which is our subway system. We are glad to be able to offer space in our stations to facilitate this new business niche.”
As to the mechanics of the deal, anyone who rents out the space — from small entrepreneurs to established corporations — are taking a lease “as-is,” and stores may appear more temporary than normal. The MTA notes that high-traffic areas can serve to increase exposure “where the emphasis is on displaying merchandise as much as actually conducting on-site transactions.” In other words, it’s another advertisement in a system working to maximize incoming revenue from ancillary avenues. (I have an inquiry into the MTA concerning Uniqlo’s rent but have not yet received a figure.)
“Pop-up stores will provide a fresh and beneficial element to our stations while also improving the image and desirability of retail space in the subway,” MTA Chairman and CEO Thomas F. Prendergast said. “This is another example of the MTA working to make better use of its real estate portfolio and improving the subway environment for customers at the same time.”
I’m as much of a Lenonist-Marxist socialist as the next New York City liberal but really I think the solution to the poor handling of retail space by the MTA may be for the MTA to entirely sell off and privatize as much as possible. They don’t seem to be a great commercial landlord, and why are they serving that role in the first place? If it’s behind fare control it’s one thing, but all that space in Columbus Circle for instance? What happened to that RFP they issued to find somebody to manage all that renovated space? No private landlord would let all that valuable space go vacant for so long. Space under the most expensive commercial districts in the world and it’s just sitting there. I can’t possibly believe that visions of Bernhard Goetz keep retailers away in subway stations in Manhattan anymore.
It would be nothing short of idiotic for the MTA to sell its real estate. All they have to do is hire some commercial real estate agents and developers to work on plans to lease out MTA space. The MTA just hasn’t prioritized it.
But at a few stations, like Coney Island, the MTA has leased out to Bank of America, Dunkin Donuts, Subways, and some other name brand retailers. La Famiglia leased out space in the Roosevelt Avenue/Jackson Heights train station in Queens.
I remember in the 1950s and 60s when Union Square was filled with dozens of retail vendors, and all stores were always crowded. When the MTA took over, they decided these retail spaces were an eyesore that hindered pedestrian movement and ordered all of them to close down seemingly overnight. It had nothing to do with them not being profitable. To say anything else is to rewrite history.
Apparently at the time the MTA wasn’t concerned about losing revenue. If the desire to improve pedestrian flow was the impetus to close these establishments down, why is there less of a need today for unhindered pedestrian flow with ridership at an all time high?
Why would a store in a space reserved for commercial use but unlet hinder pedestrian flow?
I remember some of those places in Union Square.
There used to be a small pretzel stand, I think between the BMT and IRT platforms, serving delicious fresh out of the oven pretzels.
Some additional retail activity like that would be very welcome to me.
There are well documented systems, like HK and Tokyo, where the subway administrators are actively involved in real estate to reduce fares and increase profit.
No reason why we shouldn’t do that here, I guess the Fulton Street station is a start.
In Tokyo at least, I think it’s generally not quite that direct… real-estate and retailing are important parts of the “rail ecosystem” but they tend to be done by separate divisions of the various operating companies, and they don’t tend to cross-subsidize.
Rather, they form mutually beneficial parts, with retailing and real-estate benefiting greatly from their convenient proximity to stations (both directly in/over/under the stations themselves, and in the same neighborhoods, as these companies tend to own a lot of real-estate around the stations), and with the rail systems benefiting greatly from the increased traffic due to the customers attracted to the retail and real-estate….
[Fares in Tokyo are limited by law, incidentally, and there’s enough redundancy that there’s also competition between different operators in many areas, so I think fares tend to be pretty inelastic…]
Speaking of underutilized real estate, the Fulton Transit Center is wasting a lot of air rights.